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President Energy PLC (PPC)

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Friday 20 October, 2017

President Energy PLC

Results of Placing and Proposed Open Offer

RNS Number : 2021U
President Energy PLC
20 October 2017
 

THIS ANNOUNCEMENT IS RESTRICTED AND IT IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES OR ANY OF ITS TERRITORIES, CANADA, JAPAN, THE REPUBLIC OF IRELAND, THE REPUBLIC OF SOUTH AFRICA OR AUSTRALIA OR ANY OTHER STATE OR JURISDICTION IN WHICH SUCH RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL

 

President Energy Plc

("President" or the "Company")

 

$8.75 million placing of 66,656,510 new Ordinary Shares

Director Dealing

and

Proposed Open Offer

 

President Energy Plc (AIM: PPC), the upstream oil and gas company with a diverse portfolio of production and exploration assets focused primarily in Argentina, is pleased to announce that it has  issued 66,656,510 new ordinary shares of 1 pence each in the capital of the Company (the "Placing Shares"), representing approximately 7.0 per cent. of the issued share capital of the Company (the "Placing") at a price of 10 pence per Placing Share (the "Placing Price"). The Placing has raised $8.75 million (£6.67 million) (before expenses). The Placing Shares have all been issued under the Company's existing authorities, granted at the Annual General Meeting held on 28 June 2017. The Company's nominated adviser, finnCap, acted as sole bookrunner in connection with the Placing. 

 

Directors' Participation and Related Party Transaction

Certain Directors of the Company have subscribed directly with the Company for Placing Shares in the Placing at the Placing Price as per the table below (the "Directors' Participation"):

 

 

Number of Placing Shares acquired

Resultant shareholding post Placing

% of Enlarged Issued Share Capital

Miles Biggins

76,179

437,238

0.04%

Rob Shepherd

300,000

309,144

0.03%

Jorge Dario Bongiovanni

76,179

76,179

0.01%

 

The participation of the Directors in the Placing constitutes a related party transaction under AIM Rule 13.

 

Schroders Investment Management ("Schroders") has subscribed for 22,789,426 Placing Shares. Schroders is a substantial shareholder in the Company and therefore its participation in the Placing is also a related party transaction for the purposes of AIM Rule 13.

 

Peter Levine, the Company's Chief Executive Officer, is considered to be an independent director for the purposes of AIM Rule 13 (the "Independent Director"). As such, the Independent Director, having consulted with the Company's nominated adviser, considers that both the Directors' Participation and the participation of Schroders in the Placing to be fair and reasonable insofar as the Company's shareholders are concerned.  

 

 

Proposed Open Offer

Subject to shareholder approval, the Company will also raise gross proceeds of up to €5 million through an Open Offer to qualifying shareholders (the "Open Offer") to provide existing shareholders the opportunity to participate at the Placing Price. The Open Offer will help to increase liquidity in the Company's shares and will allow further headroom for the proposed debt conversion described below.  

 

Further details of the Open Offer, including the timing and record date, will be notified in due course and will be set out in the Open Offer circular which will be sent to all shareholders as soon as practicable and will be available on the Company's website (www.presidentenergyplc.com) from the date of its issue.

 

PLLG Investment Ltd ("PLLG"), an entity controlled by Peter Levine, has irrevocably undertaken to vote in favour of any resolution to approve the Open Offer in due course.

 

Further, PLLG will not participate in the Placing or Open Offer since it does not want to incur an obligation to make a mandatory bid for the Company.

 

Proposed Debt Conversion

Following the completion of the Placing and Open Offer, PLLG has irrevocably confirmed that it will unconditionally convert certain of its existing debt that it has with the Company into equity in the Company at the Placing Price. PLLG has so confirmed that it will convert debt up to a level that will result in its resultant shareholding in the Company being approximately 29.99 per cent. of the Company's enlarged issued share capital. Conversion of existing PLLG debt will reduce the interest expense burden on the Company and will strengthen the Company's balance sheet.     

 

Use of Proceeds

The net proceeds from the Placing and Open Offer will contribute towards a number of important developments in the coming months. In particular the proceeds will:

 

·     Strengthen the Company's capitalised position as it continues to actively consider other appropriate production acquisition opportunities capable of delivering strong shareholder value.

·     Support and, as the case may be, accelerate the ongoing work programme at the recently acquired Puesto Flores and Estancia Vieja fields in the Neuquén Basin situated in the Rio Negro Province, Argentina, which has the potential to materially increase reserves and production to over 3,000 boepd. As announced on 9 October 2017, the work programme can be funded from existing cash flow but the additional funds from the Placing will reduce the burden on the Company's operating cashflow and allow the Company to be more flexible in its approach to funding the capital expenditure requirements at the fields.

·     Contribute towards the overall funding package or monies to be paid to the Rio Negro Province in relation to the extension of the Concession for Puesto Flores.

·     Permit the proposed debt conversion to take place for the reasons set out above.

 

The Company is focussed on developing a full suite financial toolkit to support its growth ambitions and the Placing and Open Offer is an important cost effective step in achieving that.

 

Overall the Placing and Open Offer and PLLG's subsequent debt conversion, will provide the Company with a much more cost efficient funding solution for its current requirements than relying on PLLG as its sole source of debt financing while at the same time ensuring that the Company is much better placed to secure the additional mainstream debt or similar funding options it will require in the future by securing and enhancing the existing equity base. The Company is focussed on developing a full suite financial toolkit to support its growth ambitions and the Placing and Open Offer is an important cost effective step in achieving that.    

 

Admission and Total Voting Rights

Application has been made for the 66,656,510 Placing Shares to be admitted to trading on AIM ("Admission") and dealings are expected to commence on 26 October 2017. The Placing Shares will rank pari passu with the Company's existing Ordinary Shares.

 

Following Admission the Company will have 1,020,254,127 Ordinary Shares in issue. Accordingly, the figure of 1,020,254,127 may be used by shareholders as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in, the Company under the FCA's Disclosure Guidance and Transparency Rules.

 

Peter Levine, Chief Executive Officer and Executive Chairman of President, commented:

 

"Today's completed placing, the proposed Open Offer and the subsequent PLLG debt conversion, ensures the Company is in an even better position to embark on the next stages of growth both organically and importantly by way of acquisition and provides us with a stronger base from which to develop a wider suite of tools in our financial toolbox."

 

 

The information communicated in this announcement is inside information for the purposes of Article 7 of Regulation 596/2014 ("MAR").

 

For further information please contact:       

 

President Energy Plc

Peter Levine, Chairman, Chief Executive

+44 (0) 207 016 7950

 

 

finnCap (Nominated Advisor, Joint Broker and Sole Bookrunner)

 

Christopher Raggett, Scott Mathieson, Emily Morris

+44 (0) 20 7220 0500

Emily Morris, Abigail Wayne

 

 

 

Camarco Financial PR

+44 (0) 203 757 4980

Billy Clegg, Georgia Edmonds, Mercedes Valenzuela-Goldman

 

 

1.               

Details of the person discharging managerial responsibilities / person closely associated

a)

Name

Miles Biggins

2.               

Reason for the Notification

a)

Position/status

PDMR: Chief Operating Officer

b)

Initial notification/Amendment

Initial notification

 

3.    

Details of the issuer, emission allowance market participant, auction platform, auctioneer or auction monitor

a)

Name

President Energy Plc

b)

LEI

213800MA2ZN22I4ITA79

4.    

Details of the transaction(s): section to be repeated for (i) each type of instrument; (ii) each type of transaction; (iii) each date; and (iv) each place where transactions have been conducted

a)

Description of the Financial instrument, type of instrument

 

Ordinary shares of 1 pence

 

Identification code

GB00B3DDP128

b)

Nature of the transaction

 

Purchase of ordinary shares

 

c)

Price(s) and volume(s)

Price(s)

Volume(s)

10p

76,179

 

d)

Aggregated information:

·      Aggregated volume

·      Price

 

As above

e)

Date of the transaction

20 October 2017

f)

Place of the transaction

London Stock Exchange, AIM Market (XLON)

 

5.               

Details of the person discharging managerial responsibilities / person closely associated

a)

Name

Rob Shepherd

6.               

Reason for the Notification

a)

Position/status

PDMR: Non-Executive Director

b)

Initial notification/Amendment

Initial notification

 

7.    

Details of the issuer, emission allowance market participant, auction platform, auctioneer or auction monitor

a)

Name

President Energy Plc

b)

LEI

213800MA2ZN22I4ITA79

8.    

Details of the transaction(s): section to be repeated for (i) each type of instrument; (ii) each type of transaction; (iii) each date; and (iv) each place where transactions have been conducted

a)

Description of the Financial instrument, type of instrument

 

Ordinary shares of 1 pence

 

Identification code

GB00B3DDP128

b)

Nature of the transaction

 

Purchase of ordinary shares

 

c)

Price(s) and volume(s)

Price(s)

Volume(s)

10p

300,000

 

d)

Aggregated information:

·      Aggregated volume

·      Price

 

As above

e)

Date of the transaction

20 October 2017

f)

Place of the transaction

London Stock Exchange, AIM Market (XLON)

 

9.               

Details of the person discharging managerial responsibilities / person closely associated

a)

Name

Jorge Dario Bongiovanni

10.               

Reason for the Notification

a)

Position/status

PDMR: Non-Executive Director

b)

Initial notification/Amendment

Initial notification

 

11. 

Details of the issuer, emission allowance market participant, auction platform, auctioneer or auction monitor

a)

Name

President Energy Plc

b)

LEI

213800MA2ZN22I4ITA79

12. 

Details of the transaction(s): section to be repeated for (i) each type of instrument; (ii) each type of transaction; (iii) each date; and (iv) each place where transactions have been conducted

a)

Description of the Financial instrument, type of instrument

 

Ordinary shares of 1 pence

 

Identification code

GB00B3DDP128

b)

Nature of the transaction

 

Purchase of ordinary shares

 

c)

Price(s) and volume(s)

Price(s)

Volume(s)

10p

76,179

 

d)

Aggregated information:

·      Aggregated volume

·      Price

 

As above

e)

Date of the transaction

20 October 2017

f)

Place of the transaction

London Stock Exchange, AIM Market (XLON)

 

 


This information is provided by RNS
The company news service from the London Stock Exchange
 
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